Question 1

Figure 2-14 
-Refer to Figure 2-14.Given the technology available for manufacturing doghouses and dishwashers,this economy does not have enough of the factors of production to support the level of output represented by point C.

Accepted Answer

A) True 
 B)False

Question 2

In the markets for goods and services in the circular-flow diagram,

Accepted Answer

A)   households provide firms with savings for investment.
B)   households provide firms with labor,land,and capital.
C)   firms provide households with output.
D)   firms provide households with profit.E) None of the above
F) A) and B)

Question 3

Who said,"The whole of science is nothing more than the refinement of everyday thinking"?

Accepted Answer

A)   Isaac Newton
B)   Albert Einstein
C)   Adam Smith
D)   Benjamin FranklinE) None of the above
F) A) and B)

Question 4

Suppose that someone makes the argument that because empty alcohol containers are found at many accidents,the containers cause accidents.This would be an example of

Accepted Answer

A)   sound logic.
B)   reverse causality.
C)   omitted variables.
D)   bias.E) A) and B)
F) All of the above

Question 5

Figure 2-4 
-Refer to Figure 2-4.The opportunity cost of obtaining 20 additional toasters by moving from point D to point C is

Accepted Answer

A)   0 toothbrushes.
B)   10 toothbrushes.
C)   50 toothbrushes.
D)   None of the above;the economy cannot move from point D to point C.E) B) and C)
F) A) and D)

Question 6

If a line passes through the points (20,5)and (10,10),then the slope of the line is 1/2.

Accepted Answer

A) True 
 B)False

Question 7

In the circular-flow diagram,

Accepted Answer

A)   taxes flow from households to firms,and transfer payments flow from firms to households.
B)   income payments flow from firms to households,and sales revenue flows from households to firms.
C)   resources flow from firms to households,and goods and services flow from households to firms.
D)   inputs and outputs flow in the same direction as the flow of dollars,from firms to households.E) A) and D)
F) B) and C)

Question 8

Which of these statements about economic models is correct?

Accepted Answer

A)   For economists,economic models provide insights about the world.
B)   Economic models are built with assumptions.
C)   Economic models are often composed of equations and diagrams.
D)   All of the above are correct.E) A) and B)
F) None of the above

Question 9

Figure 2-8
Panel (a) Panel (b)   
-Refer to Figure 2-8,Panel (a) and Panel (b) .Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel (a) to Panel (b) ?

Accepted Answer

A)   the tradeoff between the production of donuts and coffee changes
B)   the opportunity cost of a cup of coffee is higher at all levels of coffee production
C)   production of 4 donuts and 2 cups of coffee becomes possible
D)   production of 1 donut and 4 cups of coffee becomes efficientE) C) and D)
F) All of the above

Question 10

Figure 2-1 
-Refer to Figure 2-1.Julio buys a new pair of shoes at a shoe store.To which of the arrows does this transaction directly contribute?

Accepted Answer

A)   A only
B)   A and B
C)   C only
D)   C and DE) A) and D)
F) B) and C)

Question 11

An ordered pair is

Accepted Answer

A)   the process of checking calculations twice before placing them on a graph.
B)   two numbers that can be represented by a single point on a graph.
C)   two numbers that are represented by two points on a graph.
D)   two points on a graph that are of equal distance from the origin.E) B) and D)
F) B) and C)

Question 12

The Council of Economic Advisers

Accepted Answer

A)   was created in 1776 and consists of three members and a staff of several dozen economists.
B)   was created in 1776 and consists of thirty members and a staff of a dozen economists.
C)   was created in 1946 and consists of three members and a staff of several dozen economists.
D)   was created in 1946 and consists of thirty members and a staff of a dozen economists.E) B) and C)
F) All of the above

Question 13

With the resources it has,an economy can produce at any point on or outside the production possibilities frontier,but it cannot produce at points inside the frontier.

Accepted Answer

A) True 
 B)False

Question 14

Figure 2-5 
-Refer to Figure 2-5.The opportunity cost of this economy moving from point D to point B is

Accepted Answer

A)   zero.
B)   50 baseballs.
C)   60 bananas.
D)   50 baseballs and 60 bananas.E) A) and B)
F) A) and C)

Question 15

Figure 2-12 
-Refer to Figure 2-12.Cups of coffee per day and the hours that someone can go without sleep appear to have

Accepted Answer

A)   a positive correlation.
B)   a negative correlation.
C)   a random correlation.
D)   no correlation.E) All of the above
F) A) and D)

Question 16

Figure 2-8
Panel (a) Panel (b)   
-Refer to Figure 2-8,Panel (a) and Panel (b) .A shift of the economy's production possibilities frontier from Panel (a) to Panel (b) could be caused by

Accepted Answer

A)   unemployment.
B)   an improvement in donut production technology.
C)   an improvement in coffee production technology.
D)   an improvement in both donut and coffee production technology.E) A) and D)
F) B) and C)

Question 17

The circular-flow diagram

Accepted Answer

A)   is an economic model.
B)   incorporates two types of decision makers: households and firms.
C)   represents the flows of inputs,outputs,and dollars.
D)   All of the above are correct.E) A) and D)
F) A) and C)

Question 18

In the circular-flow diagram,

Accepted Answer

A)   firms are buyers in the markets for goods and services.
B)   households are sellers in the markets for the factors of production.
C)   firms are sellers in the markets for factors of production and in the markets for goods and services.
D)   dollars that are spent on goods and services flow directly from firms to households.E) A) and D)
F) All of the above

Question 19

It is possible for an economy to increase its production of both goods if the economy

Accepted Answer

A)   moves downward and to the right along its production possibilities frontier and the frontier is bowed outward.
B)   moves upward and to the left along its production possibilities frontier and the frontier is bowed outward.
C)   moves in either direction along its production possibilities frontier and the frontier is a straight line.
D)   moves from a situation of inefficient production to a situation of efficient production.E) A) and D)
F) B) and C)

Question 20

The art in scientific thinking -- whether in chemistry,economics,or biology -- is

Accepted Answer

A)   the design and implementation of laboratory experiments.
B)   knowing when to stop collecting data and when to start analyzing the data.
C)   deciding which assumptions to make.
D)   being able to mathematically model natural phenomena.E) B) and C)
F) A) and D)

Exam 2: Thinking Like an Economist

It is possible for an economy to increase its production of both goods if the economy

Correct AnswerverifiedShow Answer

Which of these statements about economic models is correct?

Correct AnswerverifiedShow Answer

Figure 2-12 -Refer to Figure 2-12.Cups of coffee per day and the hours that someone can go without sleep appear to have

Correct AnswerverifiedShow Answer

Figure 2-5 -Refer to Figure 2-5.The opportunity cost of this economy moving from point D to point B is

Correct AnswerverifiedShow Answer

Figure 2-1 -Refer to Figure 2-1.Julio buys a new pair of shoes at a shoe store.To which of the arrows does this transaction directly contribute?

Correct AnswerverifiedShow Answer

Figure 2-14 -Refer to Figure 2-14.Given the technology available for manufacturing doghouses and dishwashers,this economy does not have enough of the factors of production to support the level of output represented by point C.

Correct AnswerverifiedShow Answer

The circular-flow diagram

Correct AnswerverifiedShow Answer

If a line passes through the points (20,5)and (10,10),then the slope of the line is 1/2.

Correct AnswerverifiedShow Answer

The Council of Economic Advisers

Correct AnswerverifiedShow Answer

In the circular-flow diagram,

Correct AnswerverifiedShow Answer

Figure 2-8 Panel (a) Panel (b) -Refer to Figure 2-8,Panel (a) and Panel (b) .Which of the following is not a result of the shift of the economy's production possibilities frontier from Panel (a) to Panel (b) ?

Correct AnswerverifiedShow Answer

Suppose that someone makes the argument that because empty alcohol containers are found at many accidents,the containers cause accidents.This would be an example of

Correct AnswerverifiedShow Answer

Figure 2-4 -Refer to Figure 2-4.The opportunity cost of obtaining 20 additional toasters by moving from point D to point C is

Correct AnswerverifiedShow Answer

In the circular-flow diagram,

Correct AnswerverifiedShow Answer

With the resources it has,an economy can produce at any point on or outside the production possibilities frontier,but it cannot produce at points inside the frontier.

Correct AnswerverifiedShow Answer

In the markets for goods and services in the circular-flow diagram,

Correct AnswerverifiedShow Answer

The art in scientific thinking -- whether in chemistry,economics,or biology -- is

Correct AnswerverifiedShow Answer

An ordered pair is

Correct AnswerverifiedShow Answer

Who said,"The whole of science is nothing more than the refinement of everyday thinking"?

Correct AnswerverifiedShow Answer

Figure 2-8 Panel (a) Panel (b) -Refer to Figure 2-8,Panel (a) and Panel (b) .A shift of the economy's production possibilities frontier from Panel (a) to Panel (b) could be caused by

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified